In an opinion written by Judge Posner, the Seventh Circuit on Friday, June 9, 2017, affirmed OSF Saint Francis Medical Center’s summary judgment win in a $300 million antitrust suit brought by a smaller competitor alleging unlawful exclusive dealing and attempted monopolization. This alert discusses the Court’s decision in this case, which is a notable precedent for hospitals and provider networks — particularly those with substantial market shares — that wish to negotiate narrow and exclusive network agreements with payors.
Last week, in Deborah Heart & Lung Center v. Virtua Health, Inc., the Third Circuit affirmed a lower court’s dismissal of a suit filed by a hospital alleging an illegal exclusive dealing arrangement by a competing hospital and physician group for referrals made by the defendants to a third hospital rather than to the plaintiff hospital. In its decision, the court emphasized the importance of market definitions in antitrust cases, and clarified an antitrust plaintiff’s burden when alleging a Sherman Act Section 1 claim with no allegation of market power. The court held that anticompetitive effects in those cases must then be shown on the relevant market as a whole, not only on a small subset of the market. In a Health Care Antitrust Alert, our antitrust colleagues Bruce Sokler and Farrah Short analyze the Third Circuit’s decision.